What is Buyer Stamp Duty and Additional Buyer Stamp Duty (ABSD)?

Stamp duty is a tax on documents relating to the purchase or lease of a property. It is to be paid by the buyer within 14 days after the date of the document (e.g. Sale & Purchase Agreement, Tenancy Agreement) if the document is signed in Singapore. If the document is signed overseas, it has to be paid within 30 days after the date of its receipt in Singapore.

It is an offence to use a document for which Stamp Duty has not been paid on. It is also important to note that only a document where Stamp Duty is paid can be admitted as evidence in the court in cases of disagreements. More details can be found here: IRAS: What is Stamp Duty?

So what is Buyer’s Stamp Duty?

Buyer’s Stamp Duty is tax paid on the acceptance of the Option to Purchase (OTP) or Sale and Purchase Agreements (S&P). These documents are prepared and signed when you buy or sell your property. Stamp Duty is payable on the actual price or market price, whichever is higher. The buyer is responsible for paying Buyer’s Stamp Duty. Where Seller’s Stamp Duty is applicable, the seller is responsible for paying Seller’s Stamp Duty.

Calculation of Buyer’s Stamp Duty:

PAYMENT SCHEDULE OF STAMP DUTY

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So what is Additional Buyer’s Stamp Duty?

Additional Buyer’s Stamp Duty (ABSD) was first introduced on 7 December 2011 to cool the residential market and was revised upwards on 12 Jan 2013 due to the further acceleration in the escalation of the price of residential properties. ABSD is to be paid by certain groups of people who buy or acquire residential properties (including residential land) on top of the existing Buyer’s Stamp Duty (BSD), and is applicable as follows:

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The above table is meant for straightforward cases. Where the buying group consists of foreigners who fall under a Free Trade Agreement, they may be accorded the same treatment as Singapore citizens. If the buying group is made up of Singapore Citizens and Singapore Permanent Residents, a different treatment will be given. As there are many iterations, we wouldn’t be able to list them here. You may visit IRAS: Computation of ABSD for details or contact IRAS Hotline at (+65) 6351 3697, for assistance. For straight forward cases, you may use our partner’s ABSD calculator to estimate the amount of ABSD you are required to pay for your next property purchase.

Case Study on Computation of Total Buyer’s Stamp Duty

Lastly, here’s a case study for the computation of BSD and ABSD. Assume a foreigner buys a condominium at a market price of $2 million. The ABSD rate of 15% will apply to this particular buyer.

Computation of BSD:

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Computation of ABSD:

ABSD Payable: 15% on $2,000,000 = $300,000

Total Stamp Duty Payable = $54,600 + $300,000 = $354,600

We do hope this article will help you have a better understanding of the stamp duty. If you have any questions regarding stamp duty or buying a Singapore Property, feel free to contact us at hello@propertynet.sg.